The U.S. Department of Energy (DOE) has published a new report that characterizes the global manufacturing supply chain for light-emitting diodes (LEDs) and LED lighting products. The report investigates the economic impacts of this supply chain on the United States and identifies opportunities for increased domestic manufacturing.

The new report details the manufacturing process for typical LED products, identifying what proportion of LED products are manufactured and assembled in the United States and internationally, and analyzes the value added for a typical LED luminaire manufactured in the United States versus internationally. The report also examines recent macroeconomic events that have impacted the global supply chain for LED products, including tariffs and the COVID-19 pandemic. The analysis uses international trade data, market reports, and interviews with LED die, package, and lamp/luminaire manufacturers.

The analysis reveals that manufacturing of LED die and packages is concentrated in Asia, while manufacturing of LED lamps is dominated by China. In contrast, LED luminaire manufacturing takes place worldwide, and 89% of the value added for a domestically manufactured LED luminaire can be attributed to the United States. Value added analysis is used to determine the effects of a globalized supply chain on technologically advanced products, such as LEDs and LED lighting, where the supply chain is widely distributed across companies, countries, and even continents. In 2019, the total size of the North American LED luminaire market was estimated to be $11.6 billion, of which the United States is the majority share.

The report considers how the LED supply chains have shifted over the last decade and seeks to define where the domestic manufacturing opportunities are found, from an economic and feasibility perspective. Onshore manufacturing during any stage of the LED supply chain could enable infrastructure development and provide long-term manufacturing jobs and benefits. Key opportunities for increased U.S. presence within the LED lighting supply chain include:

  • High-end LED luminaires, often with high variability in design, features, and customization
  • LED luminaires that require fast lead times while maintaining lower inventories
  • Niche market LED lighting products, such as UV and human-centric lighting
  • Using additive manufacturing and 3D printing techniques, developing tools and molds, designing architectural luminaires, and fabricating luminaire components with fewer process steps or more automation.